With this type of certificate, the investor participates in the performance of the underlying asset with a leverage. – The conventional type of leverage certificate has a base price that is below the market price for the underlying asset when it is issued. If the price of the underlying asset changes upwards or downwards, the investor participates in this development on a leveraged basis. Of course, a lower limit is set by contract: the knock-out event; there is therefore no reserve liability (obligation for additional cover). However, the certificate expires when this line is reached; the investor has therefore lost the capital he invested. – There are many variants of the leverage certificate, each with special features such as underlying, strike price, leverage and knock-out threshold. – See Airbag certificate, Basket certificate, Bonus certificate, Discount certificate, Express certificate, Financial architecture, Guarantee certificate, Outperformance certificate, Participation certificate, Quanto, Risk, Sprint certificate, Strategy certificate, Theme certificate, Twin-Win-
Certificate, certificate.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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